The first quarter of 2024 saw increasing trends in Brent Crude and West Texas Intermediate prices, attributed to ongoing tensions from the Russia-Ukraine conflict and global economic conditions. OPEC countries’ production cuts and Russia’s commitment to reduce exports also supported prices.
Despite volatility, prices remained stable between US$70– US$87 per barrel. Natural gas prices, however, sank to multi decade lows due to warmer-than-expected weather and ample supply.
Looking ahead, FocusEconomics panelists forecast a 10 percent decline in spot prices for oil over the next decade, while gas prices are expected to remain below highs set in 2022, with potential declines in Asia and Europe and steady prices in the US. Increased US LNG export capacity could lead to price convergence among regions by 2025.
The price stability in the oil market also helped some oil and gas stocks register gains for the quarter. The five top oil and gas stocks on the TSX and TSXV listed below saw significant share price growth over the first three months of 2024. All year-to-date performance and share price data was obtained on April 25, 2024, using TradingView’s stock screener, and the top oil and gas stocks listed had market caps above C$10 million at that time.
1. Sintana Energy (TSXV:SEI)
Year-to-date gain: 222.7 percent; market cap: C$396.4 million; share price: C$1.07
Sintana Energy, an oil and gas exploration and development company, operates across five highly prospective onshore and offshore petroleum exploration licenses in Namibia and Colombia.
Share prices saw early year tailwinds after the company released two updates on exploration activity in Namibia’s Orange Basin. During the exploration campaign of Petroleum Exploration License 83 (PEL 83) two significant light oil discoveries were made in January.
February saw more share price growth when Sintana was listed on the TSX Venture 50 ranking as the top energy performer.
In mid-March Sintana announced the results of its warrant exercise activity, revealing an approximate 99 percent exercise rate, which generated an additional C$22.5 million in cash resources for the company. A few days later the company reported a third light oil discovery for the quarter in the Orange Basin.
Shares rose to a quarterly high of C$0.58 at the end of March.
2. MEG Energy (TSX:MEG)
Year-to-date gain: 31.8 percent; market cap: C$8.6 billion; current share price: C$31.57
MEG is an energy company with a focus on in situ thermal oil production in Alberta’s southern Athabasca oil region. Utilizing innovative enhanced oil recovery projects, including steam-assisted gravity drainage extraction methods, the company aims to increase oil recovery responsibly while reducing carbon emissions.
Shares of MEG spent the three-month session trending higher reaching a Q1 high of C$31.48 at the end of March.
In late February MEG reported its fourth-quarter and full-year 2023 financial and operating results. Included in the results was record annual bitumen production and increased funds flow from operations.
MEG’s production outlook for 2024 remains positive, with plans to optimize operations and enhance capital efficiency. Additionally, the company announced a capital allocation strategy focused on debt reduction and returning capital to shareholders.
On March 6, the energy company launched a share buyback program, aiming to repurchase up to 24,007,526 common shares between March 11, 2024, to March 10, 2025. This initiative is part of the company’s strategy to enhance shareholder returns and reduce debt.
3. Obsidian Energy (TSX:OBE)
Year-to-date gain: 29.4 percent; market cap: C$912.9 million; current share price: C$11.79
Obsidian Energy is an intermediate-sized oil and gas producer, with a portfolio of assets that yield approximately 32,000 barrels of oil equivalent per day. The company’s primary operations are in the Peace River, Cardium, and Viking regions of Alberta, Canada.
In early January, Obsidian released its full year 2023 results which included a 6 percent year-over-year increase. Later in the month the Calgary-based company provided the results of a 2023 independent reserves evaluation.
“We replaced 124 percent of 2023 production on a proved developed producing (PDP) basis, 157 percent on a total proved (1P) basis and 217 percent on a total proved plus probable (2P) basis,” the statement read.
In February Obsidian announced the completion of the first half 2024 capital program, highlighting ongoing development in the Willesden Green/Pembina assets in Cardium and exploration and appraisal activity in the Clearwater and Bluesky formations in Peace River.
Additionally, Optimization of Viking wells drilled in late 2023 yielded strong production results.
“Current production has surpassed 36,500 barrels of oil equivalent per day (boe/d) based on field estimates. Despite production impacts from January’s cold weather, operations have resumed normalcy, with production slightly exceeding planned targets year-to-date, aided by strong initial rates from wells brought online in February,” the company said.
In March, Obsidian successfully completed a previously announced offer to purchase 2 million of its outstanding senior unsecured notes.
Share reached a quarterly high on March 31 and were trading for C$11.26.
4. Imperial Oil (TSX:IMO)
Year-to-date gain: 27.25 percent; market cap: C$51.92 billion; current share price: C$96.91
Calgary-based Imperial Oil is a prominent Canadian energy company involved in exploration, production, refining, and marketing of petroleum products. With a history spanning over 140 years, Imperial operates diverse assets across Canada, including oil sands, conventional crude oil, and natural gas assets.
On February 2, Imperial released its Q4 2023 results which highlighted upstream production of 452,000 gross oil-equivalent barrels per day, “marking its highest level in over three decades.”
Additionally, Imperial initiated steam injection at Cold Lake Grand Rapids, pioneering the industry’s first deployment of a solvent assisted SAGD technology. Downstream operations performed strongly, with refinery capacity utilization reaching 94 percent, following the successful completion of the largest planned turnaround at the Sarnia site.
The company returned more than C$2.7 billion to shareholders, including the completion of a substantial issuer bid. Additionally, Imperial increased its quarterly dividend by 20 percent, from C$0.50 to C$0.60 cents per share. Lastly, the company released its annual corporate Sustainability report, highlighting its sustainability focus areas and achievements.
In March Imperial implemented temporary measures to ensure fuel supplies to Winnipeg during unplanned pipeline maintenance. The Winnipeg Products Pipeline, which transports gasoline, diesel, and jet fuel to the area, required preventative maintenance, including the replacement of a section under the Red River.
The work that began in mid-March is expected to take three months.
Shares marked a Q1 high of C$94.69 on March 31.
5. Condor Energies (TSX:CDR)
Year-to-date gain: 23.94 percent; market cap: C$99.4 million; current share price: C$1.76
Condor Energies concentrates on the exploration, development, and production of natural gas resources across Turkey, Kazakhstan, and Uzbekistan. Notably, the company is currently building Central Asia’s inaugural liquefied natural gas facility.
Furthermore, in mid-2023, it disclosed the procurement of a lithium brine mining license in Kazakhstan.
In late January Condor secured a natural gas allocation from the Government of Kazakhstan for its maiden modular liquefied natural gas (LNG) production facility. The gas allocation will be instrumental in liquefying feed gas to produce up to 350 tonnes per day of LNG, equivalent to about 210,000 gallons per day, the company said.
Condor shares rose to a quarterly high of C$2.76 on February 20.
In March, the energy company began a production enhancement operation for eight natural gas-condensate fields in Uzbekistan. Gas output will be directed to the domestic market through state entity agreements. Condor has agreed to cover project costs and receive a share of the generated revenues. The production increase plans will be facilitated through several measures including artificial lift and drilling programs, exploring deeper horizons, and conducting seismic reprocessing.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
